updated 7/6/2009 5:10:39 PM ET 2009-07-06T21:10:39

With health care legislation at a crossroads, the nation's hospitals are near agreement with a key lawmaker and the White House to pick up part of the cost of President Barack Obama's plan for expanded coverage, officials said Monday.

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The precise size of the deal was not available, although several days ago, talks were focused in the range of $150 billion to $155 billion over a decade. These officials said under the emerging agreement, hospitals would accept lower-than-anticipated payments under Medicare and Medicaid, the federal health care programs for seniors and the poor.

Any agreement involving Sen. Max Baucus, D-Mont., chairman of the Senate Finance Committee, and the White House would give fresh momentum to efforts to write bipartisan legislation on an issue that Obama has placed atop his list of domestic priorities.

Obama has said he wants to sign a bill in October that would reduce medical costs and provide coverage to nearly 50 million uninsured Americans.

Baucus and the White House reached agreement with the drug companies two weeks ago for pharmaceutical firms to spend $80 billion over a decade, divided between closing a coverage gap under Medicare as well as defraying part of the cost of providing health care to millions who lack it.

Last week, Wal-Mart, the nation's largest private employer, gave a boost to the White House when it announced support for a requirement on large firms to offer health coverage to their work force.

Announcement could come Tuesday
Several officials said no agreement with the hospitals had been sealed, although a formal announcement could come as early as Tuesday at the White House. The officials, who have been closely following the negotiations, spoke on condition of anonymity, citing the confidential nature of the discussions.

Baucus said in a brief interview last month he was negotiating with several health care industries in a search for money to cover the cost of legislation, which is expected to reach $1 trillion.

Elizabeth Lietz, a spokeswoman for the American Hospital Association, said they "are talking with folks on health care reform, including the Finance Committee and the White House and other groups. But at this time we have nothing to report."

A spokesman at the Federation of American Hospitals declined to comment.

Under legislation taking shape in the House as well as the Senate, millions of uninsured Americans would receive coverage over the next few years, creating a huge new pool of customers for hospitals, drug companies, doctors and insurance companies. As a result, these industries are under pressure from the Obama administration and lawmakers to give up some of the fees they are currently scheduled to receive under the current system.

Hospitals, for example, receive special payments under both Medicare and Medicaid for taking care of patients who lack coverage.

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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